House Passes Comprehensive Debt Collection Improvement Act

Despite objections from CUNA and NAFCU, the U.S. House of Representatives passed the Comprehensive Debt Collection Improvement Act on May 13. HR 2547 was sponsored by Financial Services Committee Chairwoman Maxine Waters (D-Calif.) and passed with a 215–207 vote.

In a letter sent to leaders of the House and Senate, CUNA President/CEO Jim Nussle stated his objections to section 403 of the bill, which would amend the Fair Credit Reporting Act to prohibit credit scoring models from treating certain medical debt information on consumers’ credit report as a negative factor.

“Lenders rely on complete and accurate credit reports when underwriting loans,” the letter stated. “Restrictions on the reporting or consideration of certain debt prevents lenders from seeing borrowers’ complete debt circumstances and clouds lenders’ ability to fairly assess borrowers’ creditworthiness. An incomplete view of borrowers’ credit history reduces lender confidence in credit reports and scores, impacting pricing decisions and credit availability. The borrowers most impacted by the consequences of this provision will be low- and moderate-income borrowers whose financial well-being could benefit the most from access to affordable credit from a credit union.”

A separate letter was sent to lawmakers from CUNA, NAFCU, American Bankers Association, and Independent Community Bankers of America with similar objections.

Read more at CU Times.